The event was attended by dignitaries from Japan, Norway, US, Singapore, South Korea and Australian energy minister Josh Frydenberg.
The new institute's founding directors are Woodside Petroleum chief operating officer Mike Utsler, Jackson McDonald partner Richard Sandover, P and H Marine Australia's Captain Walter Purio, Mitsubishi's Hero Gohda, GE Oil & Gas' Mary Hackett, Altegra Property group's Tony Brooks and Stephen Smith, who vowed to challenge now-Western Australia Premier Mark McGowan for the WA Labor leadership last year.
"In mid-2016, a group of people from the Australian marine, LNG, academic and general commercial sectors came together," Sandover, who recently launched the institute at an event at Parliament House, said.
"We shared a conviction that bunkering heavy fuel oil, which traditionally powers global maritime shipping trade had to change."
The initiative is another plank in the move to drive LNG as a marine fuel after Utsler's joint industry project with BHP Billiton, Rio Tinto and Fortescue Metals Group announced last month it had developed a new ship design that demonstrates the feasibility of LNG-fuelled bulk carriers in a "green corridor" between Australia and China.
Hackett's involvement in the institute is unsurprising given Woodside announced in February it had signed an agreement with GE that would see the two companies partner to support the use of LNG as fuel in WA to power mine sites.
But the drive of the LNG MFI is a decision by the International Maritime Organisation to introduce a global 0.50% sulphur cap on vessel emissions in 2020, from 3.5% today, will impact bunker fuel selection, and that is expected to drive the marine industry towards a multi-fuel future that will include low-sulphur options, with LNG an important part of that mix.
Sandover said it had been clear to the industry stakeholders, including Woodside Petroleum and BHP Billiton, that LNG "could and should" replace HFO in the maritime shipping industry.
He said Australia, which sends bulk commodities such as LNG, iron ore and coal to Asia, could be at the forefront of the development of LNG as a marine and transport fuel, reaping the benefits of establishing an LNG bunkering industry in Australia.
The LNG MFI is an independent not-for-profit organisation designed to do just that.
"LNG MFI supports the establishment of a ‘green corridor' for the bulk ore and LNG export trade between China and Australia, Japan and Australia, Korea and Australia and other south east Asian countries," Sandover said.
"With collaboration between industry, government and the community this can lead to the establishment of an LNG bunkering industry in Australia, jobs for Australians and enhanced energy security for Australia."
Australia is more than 90% reliant on imported transport fuels, despite its extensive gas reserves, which was an energy and national security risk.
A number of OECD countries including China, USA, Canada, the Baltic States and the European Union have started the IMO process of reducing pollution, some even mandating even more stringent standards relating to emissions from ships sailing through their territorial waters to as low as 0.1%, something that cannot be achieved with HFO.
LNG as a marine fuel emits negligible sulphur dioxide, nitrous oxide and particulates emissions and 10-20% lower greenhouse emissions.
"By every measure, LNG is a significantly cleaner marine fuel by comparison to HFO," he said.
LNG MFI sees a future for LNG fuels, not only in the marine industry … but also road, rail and mining industries, something Woodside is pushing for in the Pilbara region.
